FredBloggs wrote:The downside, I think, is the rapidity with which the automobile industry is hurtling towards electrification. 10 to 15 years time, the cars parked in your street could be electric just as likely as infernal combustion engine powered. But............. electric propulsion does not require catalytic converters.

Apparently platinum is also used in fuel cells, so the move toward electric vehicles might turn out to be positive for the metal. From the demand drivers section of the World Platinum Investment Council's website:

World Platinum Investment Council wrote:Platinum’s superior catalytic and conductive properties in fuel cells turn hydrogen and air into water producing electricity to power electric cars with zero emissions ... Fuel cell electric vehicles (FCEV) use more than twice the amount of platinum in internal combustion engine vehicles.

I have been seriously considering buying into this one, but have yet to pull the trigger. Assuming this is a blip rather than the start of a prolonged breakout, I will probably wait for the technical indicators to (hopefully) return to bargain-basement territory and then assess the prospects.

CommissarJones wrote:The old dog is showing some life - Lonmin rose 14% today.

I have been seriously considering buying into this one, but have yet to pull the trigger. Assuming this is a blip rather than the start of a prolonged breakout, I will probably wait for the technical indicators to (hopefully) return to bargain-basement territory and then assess the prospects.

JMN2 wrote:I should really stop looking into this but am up 42 per cent.

What a blip!

If I've learnt one single investment-lesson personally, it's that when I start wanting to tell people how well one of my stocks is doing, historically it has proven to have been almost the exact point where I should also have started to sell at least some of my holding in that particular stock....

Nice Bloomberg story here from last month that IMV does an effective job of shedding some light on why Lonmin might indeed have been anxious to sell out when the opportunity presented itself.

Bloomberg wrote:Every day, Lonmin Plc sends thousands of miners hundreds of meters below ground, where they use drills, diggers and explosives to extract about 40,000 metric tons of rock laden with precious metals.

The ore is milled, crushed, concentrated, smelted and refined in a month-long process that eventually yields about 4,100 ounces of platinum-group metals each day. Yet for all its trouble, Lonmin’s revenue in the most recent quarter was barely $3 an ounce higher than its costs.

If this deal was unimpressive to begin with, it has really gone into the toilet in the last week.

Sibanye's annual results on Feb. 22 were poorly received, to say the least - the stock, the "currency" for this transaction, fell 16% that day and is now down 27% from the price before the takeover was announced (close of ZAR11.68 today versus ZAR16.11 on Dec. 13). That values Lonmin shares at about 62.5 pence each, against 100p at the time of the announcement, using the same GBP/ZAR exchange rate. The rand has strengthened against sterling since then, so the shares are worth 69p each at the current rate, which is slightly less gruesome.

The biggest Lonmin shareholder (with about 29%) is Public Investment Corp., which is owned by the South African government. However, PIC is also the second-largest Sibanye stockholder (owning about 11%), so it's not obvious to me that they have any particular motivation to push for a better deal here. One wonders what the likes of Majedie, Schroders, Legal & General and Ruffer (all on the Lonmin register) make of the situation.

Liberum speculated last week that Sibanye's takeover of Lonmin might fall through because of the effect on Lonmin's finances of low platinum prices and the stronger rand. But in yesterday's interim results, Lonmin said it still expects the deal to complete in the second half of 2018. And now the UK competition regulator has decided to stick its oar into the situation as well.

The price action of the two stocks is not pretty. Sibanye has dropped almost 20% in May, and Lonmin is down about 15%.